Nigeria’s reform success hinges on living standard

Nigeria's ambitious economic reforms, initiated three years ago, are shifting from macroeconomic stabilization to the critical challenge of improving citizens' welfare. Initially focused on correcting distortions through measures like removing petrol subsidies and reforming the foreign exchange market, the government and the Central Bank of Nigeria (CBN) have seen some positive macroeconomic indicators. The economy grew by 3.89% in the first quarter of 2026, external reserves exceeded $50 billion, and inflation saw a marginal decrease.

Despite these gains, the reality on the ground for households and businesses remains difficult, with persistent high food prices, elevated borrowing costs, and diminished purchasing power. This disconnect was a central theme at the 7th Africa Emerging Markets Forum in Abuja, where experts emphasized that future reforms must deliver tangible benefits, moving beyond stabilization to actively create jobs, boost productivity, and enhance living standards.

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Intra-African trade still accounts for only about 16 per cent of our total trade. We must build stronger regional value chains, produce more of what we consume, and trade more with one another.

CBN Governor Olayemi Cardoso highlighted that this challenge is not unique to Nigeria but is a continental concern as Africa navigates a rapidly evolving global economy. He identified key global shifts, including the fragmentation of global trade, which he believes necessitates deeper regional integration among African nations. Cardoso urged for stronger regional value chains and increased intra-African trade, which currently stands at only 16% of the continent's total trade.

Cardoso also pointed to the increasing selectivity of global capital, noting that the era of abundant liquidity is over. Investment now favors countries with credible institutions and transparent policies. This underscores the need for Nigeria and other African nations to build investor confidence through sound governance and predictable economic management to attract the necessary capital for sustainable development and improved living standards.

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The era of abundant liquidity chasing returns regardless of risk is over.